Westpac all alone with rate rises

Commonwealth Bank and ANZ are not expected to follow Westpac’s move and raise rates on standard variable rate mortgages by substantially more than the Reserve Bank has this week.

Pressure is building on Westpac to backtrack on its Tuesday announcement to add 0.20 per cent to the RBA’s recent rate rise.

On Tuesday the RBA raised the official cash rate by 0.25 per cent. Westpac followed by announcing that it will raise rates on standard variable mortgages by 0.45 per cent, drawing an angry response from consumer groups and the federal government.

Westpac’s subsidiary brands, St George Bank and BankSA are also not expected to raise interest rates by as much as their parent bank.

A Westpac spokesperson said yesterday there were no plans to change the new mortgage rate. “It is the responsible decision based on funding costs,” he said.

Source: Sydney Morning Herald